Hello and welcome to Nyxoah's Second Quarter 2025 Earnings Conference Call. I would now like to hand it over to Pearson Dennis. You may proceed. Thank you. Good afternoon, everyone, and I welcome you to our second quarter 2025 earnings call. Participating from the company today will be Olivier Taelman, Chief Executive Officer; and John Landry, Chief Financial Officer. During the call, we will discuss our operating activities and review our second quarter 2025 financial results released after U.S. market closing today, after which we will host a question-and-answer session. The press release can be found on the Investor Relations section of our website. This call is being recorded and will be archived in the Events section on the Investor Relations tab of our website. Before we begin, I'd like to remind you that any statements that relate to expectations or predictions of future events, market trends, results or performance are forward-looking statements. All forward-looking statements are based upon our current estimates and various assumptions. These forward-looking statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. All forward-looking statements are based upon current available information, and the company assumes no obligation to update these statements. Accordingly, you should not place undue reliance on these forward-looking statements. For a list and description of risks and uncertainties associated with our business, please refer to the Risk Factors section of our Form 20-F filed with the Securities and Exchange Commission on March 20, 2025. With that, I will now turn the call over to Olivier.

Thank you, Pearson. Good day, everyone, and thank you for joining us for our second quarter 2025 earnings call. I'm extremely proud to announce that we received FDA PMA approval for our Genio system in the United States. This result was the culmination of persistence, strong regulatory and clinical execution supported by the entire passionate and committed Nyxoah team. For U.S. patients suffering from obstructive sleep apnea or OSA, the Genio system provides them with a significant advance from currently available treatment options. For physicians, they now have a choice to select the optimal HGNS therapy for their patients. For Nyxoah, it marks the beginning of an exciting journey in the U.S. This PMA approval confirms the safety and effectiveness of our innovative technology and authorized commercial distribution in the U.S., which now has actively begun. The Genio system becomes the first and only bilateral HGNS approved in the U.S. for treatment of OSA. It's also important to note that the Genio system is not contraindicated for patients suffering from complete concentric collapse or CCC. Another key differentiator represented in our label highlights our ability to treat patients with positional OSA. This is important as according to published data, a patient's AHI score can double when a patient sleeps in a supine position, on their back. Having this in our label serves as a validation of the clinical outcomes from our pivotal DREAM study, which met its primary endpoints regardless of a patient's sleep position. Also note that complete concentric collapse or CCC is not contraindicated but is included as a warning in the company's label as the safety and effectiveness for patients suffering from CCC has not yet been established through the Genio system based on U.S.-specific clinical data. Our goal is, however, to make Genio available for U.S. patients suffering from CCC as soon as possible. Therefore, we strategically elected to stop enrollment in the ACCCESS study. We believe that the number of patients enrolled in ACCCESS will have enough statistical power to draw meaningful conclusions on our effectiveness for complete concentric collapse patients. In addition, we see great results in realized data from patients in Europe where our CE mark already includes an indication for CCC patients. I'm also pleased to report that our DREAM study was published by the Journal of Clinical Sleep Medicine which is a leading journal for the sleep community. I'd like to highlight a couple of data points that were published for the first time, which demonstrate a high level of patient satisfaction. The device demonstrated compliance of 85.9% and the patient satisfaction was scored at 90%. This data confirms our early experience in Europe, and we believe the publication of the DREAM study will strengthen our U.S. launch and will also give us access to new international markets. Immediately, upon receiving FDA approval, we started our focused U.S. launch with a commercial organization with over 50 highly talented and experienced professionals. This team is now executing on our two-pronged launch strategy. They will target high-volume hypoglossal neurostimulation implanting centers, where they will position Genio, a differentiated option for patients suffering from OSA. And they will focus on developing strong referral networks with sleep physicians, managing large populations of moderate to severe OSA patients who quit CPAP but are in need for treatment. Our U.S. sales team is already actively engaging with these targeted sites, working through the value analysis committee and pre-authorization approval processes. From a launch execution perspective, I am very pleased to report that already in the first week we received several VAC and pre-authorization approvals. It's also very exciting to see multiple physicians with patients lined up who are running quickly to become the first to implant Genio commercially in the U.S. Regarding reimbursement, we have identified the use of CPT code 64568, which has been recognized by commercial and government payors for the OSA indication. This is the same CPT code used by our competitor, and we feel confident that we will be able to differentiate ourselves via our unique technology benefits and patient focus. As a result of our ongoing work with the American Academy of Otolaryngology and participation in the FDA's Early Payor Feedback Program, educating CMS and major commercial payors on the clinical impact Genio can have on their OSA patients positions us well for acceptance of pre-authorization submissions in the near term and favorable coverage decisions in the long term. With over 100 physicians in the U.S. already trained and additionally weekly training sessions scheduled, there is strong momentum building in the medical community. Our initial traction in the marketplace is demonstrated by the many physicians lining up patients for a Genio implant in just our first week of commercialization. This early interest gives us confidence in the success of our U.S. launch. We have also identified demand from patients who are hesitant about receiving an implanted battery, which requires the need for subsequent surgery to replace this battery. The Genio system addresses this need with its unique and less invasive design. There has recently been a lot of discussion on the potential impact of GLP-1 on the HGNS market. Contrary to our competitors, we have strategically limited our patient population to doses with a BMI below 32 since that is where the efficacy for Genio is proven. As a result, we believe that the eligible Genio patient population will grow, not shrink. This belief is based on SURMOUNT study data showing GLP-1's ability to bring patients with high BMIs of 37 and above down to a BMI level where clinical data demonstrates that Genio is effective. Without GLP-1, we would never be able to treat this high BMI patient population. While there might be patients with lower BMIs dropping out of the potential HGNS patient population, this will be outweighed by a significant number who become eligible for HGNS. On another topic, prior to Genio FDA approval, Inspire Medical initiated a patent lawsuit against Nyxoah. Since Nyxoah was founded, we have invested significantly in our IP portfolio, and we will vigorously defend ourselves in this matter and have the means to do so. This patent lawsuit will not impact our U.S. commercial launch, which is already underway and generating a lot of enthusiasm in the marketplace. To conclude my opening remarks, I want to emphasize that the FDA approval marks a pivotal moment for Nyxoah. Our bilateral stimulation technology offers a truly differentiated solution that makes us unique for patients. We believe Genio can fundamentally improve the quality of life for OSA patients by giving them a good night's sleep. With the current ongoing momentum and physicians already lining up patients for Genio, we are confident in our ability to execute a successful U.S. launch. With that, I'll turn the call over to our CFO, John Landry, for a financial update.

Thank you, Olivier. We recorded revenue of EUR 1.3 million in the second quarter of 2025 compared to EUR 800,000 in the second quarter of 2024 for an increase of 73.8%. Gross margin in the second quarter of 2025 was 63.4% or essentially flat to the second quarter of 2024. Total operating loss for the second quarter of 2025 was EUR 19.9 million versus EUR 13.3 million in the second quarter of 2024. This was driven by the acceleration in the company's commercial investments in the U.S. in preparation for post-FDA commercial launch. Our cash position, including cash, cash equivalents and financial assets was EUR 43 million at June 30, 2025, compared to EUR 63 million at March 31, 2025. We also have EUR 27.5 million available to us under our term debt facility, which can be drawn down in two equal tranches of EUR 13.75 million each, which are subject to certain milestones. With that, I'd now like to hand the call back to Olivier to discuss his thoughts on the remainder of 2025. Olivier?

Thank you, John. Before we conclude, I want to emphasize that this FDA approval represents a truly historic moment for Nyxoah. I would like to thank all Nyxoah employees for their persistence and efforts in making this happen. We have now officially entered the U.S. OSA market with our innovative Genio solution, and the launch is actively ongoing. The enthusiastic response from physicians and their patients reinforces our confidence in the success of this U.S. launch. We believe the remainder of 2025 will be a transformative period as we establish Genio in the U.S. market and advance our mission of making sleep simple for patients worldwide. We look forward to updating you on our progress on our next earnings call. With that, I would now like to open the line for questions and answers.

Our first question comes from Jon Block with Stifel.

Congratulations to you and the team, John. To start, do you have any year-end metrics for 2025 that we should be keeping an eye on? What about leading indicators like the number of trained physicians or certified centers? I know you mentioned having over 100 certified centers already, along with the number of implants. It might be early days, but as we look ahead to the next 3 or 4 months, where should we focus our attention regarding the Genio launch as we approach the end of 2025?

Yes. Thanks for the question, Jon. In terms of some of the leading indicators that we're tracking, obviously, we mentioned today the number of physicians trained. That's going to be something that we keep a close eye on as that's obviously a leading indicator. We'll also be looking at the number of value analysis committee applications that we submit to the various institutions over time as that's also another leading indicator. I think over time, we'll be looking at some other metrics vis-a-vis maybe number of accounts opened or pre-authorization approvals received. However, at this point in time, we're still working through that, and we'll share more on our next quarterly call with all of you.

Fair enough. And then I'll sort of pivot, Olivier, this one might be for you. But just obviously, there was the approval, but then there was also, I don't know, maybe call it like the favorable label that went along with the approval. So can you talk about how you expect to leverage the differentiated label such as no CCC contraindication, the sleep positional data. I know if it's more of a commercial question, if you would, but how do you expect to capitalize on that in the go-to-market when we think about over the next handful of quarters?

Thank you for your question. It was a significant achievement for us to see this differentiation reflected in our label. Our mission is to simplify sleep, which means ensuring we can protect patients throughout the night, regardless of their sleep position. This is why positional obstructive sleep apnea (OSA) is crucial, as we continue to demonstrate the effectiveness of our technology and therapy. Genio is the only technology providing this capability, particularly in relation to supine data and positional OSA. Regarding CCC, it's very encouraging that the FDA recognized our efforts by not issuing a contraindication, unlike our competitors. With the ACCCESS initiative, our principal investigators have successfully implanted a substantial number of devices, allowing us to close enrollment earlier. We are eager to make our solution available to CCC patients in the U.S. Both of these achievements are reflected in our label. I understand you and your colleagues have had questions about this in the past, and this reaffirms what we previously stated: bilateral stimulation has a distinct advantage over unilateral stimulation, which will certainly assist in persuading physicians when deciding between the two available high-gain neurostimulation technologies.

Our next question comes from the line of Adam Maeder with Piper Sandler.

This is Kyle on for Adam. We extend our congrats on FDA approval as well. Maybe just first to double-click a little bit on the commercial strategy that you discussed in your prepared remarks. I was hoping to get an idea of like which accounts you're kind of aiming to target first? Are they kind of centers from the DREAM study, some of the high-volume implanters? Can you just give us kind of any color around the accounts and the strategy there?

Yes. No, no, definitely. So as I mentioned in the script, we have a two-pronged approach. So first of all, we go and our sales team will focus on high-volume hypoglossal neurostimulation implanting accounts. Maybe as a quick reminder to this, you know that in the U.S., there are roughly 1,400 implanting accounts offering HGNS, but it is a very concentrated market, meaning that 350 to 400 of these are high-volume accounts and are representing 75% to 80% of the total revenue. So those are the accounts the team will be focused on. We start with a team of 50 commercial people, of which 25 are territory managers, they will all have 4 to 6 of these accounts. And we have built what we call a scalable technology. So every quarter, we will add a number of territory managers and increase the number of accounts that we can cover as soon as possible, all 400 of those high-volume implanting accounts. So that is what we call our focused launch. Next, and I think as important is also strengthening the referral part and the way we are doing this in that at Nyxoah, it's totally different compared to the way it's done in the past in the sense that we will focus on patients that have moderate to severe OSA and that are quitting CPAP. And also, there focusing on those specific patient groups will definitely strengthen the trust and confidence of sleep physicians, and we'll also further make sure that patients in need for treatment will get a sleep surgeon that can help them with a Genio solution. So that's all we plan to go forward with our launch strategy.

That's very helpful. For my second question, I wanted to shift the focus to reimbursement. How do you plan to approach that process moving forward? Are there any logistical considerations regarding your work with different payors? More specifically, when can we anticipate the onboarding of some of the larger payors? Would it be reasonable to expect this by the end of this year, or is it more likely to be a story for 2026?

Yes. Thanks, Kyle. I can take this question. So in terms of our reimbursement strategy, we have a comprehensive reimbursement strategy. So we're using, as you may be aware, an established CPT code at launch, we're using the 64568 code. We've worked closely with the AAO on that particular code. We've participated in the FDA's Early Payor Feedback Program. And we've also been working with engaging CMS and major commercial payors in the U.S. around this particular code. So as we work through this multifaceted approach and strategy. We expect these decisions will start coming in first for the pre-authorizations, we'd expect some of those to come in this year, clearly. I think we mentioned we had our first one now. But we expect more of those to come in over the balance of the year. And then as we start moving into more of the coverage decisions, if you will, that will be probably more of a 2026 item, Kyle.

Our next question comes from the line of Suraj Kalia with Oppenheimer.

Olivier, John, can you hear me all right?

Yes, we can.

Gentlemen, congratulations on the approval. I know it's been a long time coming. Olivier, let me start by asking about the ACCCESS enrollment, which you mentioned has been stopped. I assume the SMB contributed to that decision.

Yes. Regarding the ACCCESS study, we have reached a significant number of patients who are already implanted, which gives us confidence in our ability to draw statistically meaningful conclusions. To provide some context, we have more than double the number of patients compared to those in the OSPREY study, where they are also examining CCC patients. This is important information for you to know. Additionally, our decision was driven by our desire to assist CCC patients in the U.S., similar to our successful efforts in Europe and as demonstrated in Australia in the BETTER SLEEP study. Therefore, we cannot afford to wait. With enough patients implanted, we believe it is a well-considered decision to stop earlier and activate the 12-month follow-up timeframe. By this time next year, we should be able to publish those data and submit a PMA supplement. We anticipate that by late 2026 or early 2027, we will also be able to add this to our label in the U.S. and provide support to CCC patients who are currently contraindicated for HGNS.

Got it. Olivier, I have a question about your outreach in Asia and how you plan to leverage your battery technology to assess CCC, battery life, and related aspects. How are you considering packaging this? Will you take a similar approach, or do you plan to pursue a targeted strategy for bilateral stimulation?

So first of all, Suraj, we will further leverage our more clinical data. I think this is really important so that we look at patient phenotypes where we know we are extremely efficient, the adult patient population. Then when it comes to AHI, and I would like to point this out in DREAM, our AHI range is 15 to 65 in which is already different compared to competition, where it's 20 to 50. So there, we're already able to demonstrate a strong number, 15 to 65. So that is one aspect. Another aspect is what we learned in market research is for physicians it's extremely important to know that their patients will be protected throughout the entire night. So this is something that is not only resonating well with ENT servings, but it's very well resonating with sleep physicians who have to refer patients because they see this effect when they start studying polysomnography sleep exams, they see exactly when a patient is in what position. So it's a great benefit being able to show protection throughout the night for a sleep physician, providing them confidence when they refer a specific patient all the way to an ENT surgeon for Genio. And then last, when it comes to the outreach, yes, we have a focused launch. We start with 25 territory managers. They all cover 4 to 6 centers. I think already explained how concentrated the business there is in the U.S., and we will scale quarter-after-quarter by adding roughly 50 new territory managers and each time adding up to 75 new implant sites. And that, to John's point, will also become one of our key metrics in measuring our success going forward, and it gives us the ability in the short term also to reach all 350 to 400 high-volume sites. Hope this is answering your question.

Our next question comes from the line of Ross Osborn with Cantor Fitzgerald.

This is Matt Park on Ross today. Congrats again on FDA approval. So starting off with Olivier on VAC approvals, how should we think about a reasonable pace for account openings through the remainder of '25 and into '26? And then are there any headwinds here that we should be mindful of?

Yes, it's a great question. The team has done an excellent job categorizing the VAC committees based on the time they need to make decisions. We've noticed that some committees move very quickly; in fact, we've already received approvals from several of those fast-moving VAC committees. However, there are also committees that take significantly longer, with some taking up to nine months. We'll focus on this segmentation, ensuring we engage immediately with the fastest committees to scale effectively. While I don’t want to provide an exact number for what we will achieve by the end of this year, it's evident that all the hospitals we are targeting will go through the VACs, and we anticipate receiving approval from all of them within the next six months.

Got it. That's super helpful. And then I got one for John here. As we're thinking about spend in the back half of the year and into '26, as you guys build out your commercial infrastructure in the U.S., can you kind of walk us through some of the puts and takes around operating leverage that we should be mindful of?

Sure. From an operational expense perspective, we don't provide specific guidance, but I can share some insights regarding our investment levels. For the latter half of this year, we anticipate that research and development spending will remain steady and may increase slightly from last year due to investments in IP litigation. In terms of selling, general and administrative expenses, we expect a year-over-year increase because of the investments we made in our sales and commercial teams in the U.S., which include 50 skilled professionals. Looking ahead to 2026, we foresee that the majority of our spending increase will occur in SG&A, particularly as we expand our commercial organization by adding 15 territory managers throughout the year. Consequently, we could see the SG&A expenditure almost doubling in 2026 compared to 2025.

Our next question comes from the line of David Rescott with Baird.

Great. Congrats on the approval here. I wanted to ask first on reimbursement, the VAC, the prior-auth processes that you've called out in the prepared remarks. I guess can you just help us understand what considerations go into those VAC and prior-auth conversations? Are you definitively kind of locked-in to reimbursement there? Is that fully ironed out? Just how do we think about what the prior-auth and VAC processes are relative to kind of what line of CPT code and commercial coverage...

Sure. Yes. Thanks for the question, David. Yes. So early on, it's clearly early on in the process. But in terms of the approvals that we received, vis-a-vis the VAC and/or the pre-authorizations, the answer is yes. So we've gone through the process. I think really what we're looking to do there is demonstrate the clinical efficacy and the effectiveness of the technology. Certainly, utilizing the HGNS code, the 64568 code on the CPT side. And we've been able to have success in demonstrating that at least in this early stage to those hospitals and accounts and centers where we've completed the VAC. And as Olivier mentioned, there are various lengths of process for these VACs as well the pre-authorization process, the VAC approvals can range anywhere from very short periods of time up to 9 months. And on the pre-authorization process, it's extended as well. So that's where we're at this point in time and look forward to continuing to build this body of approvals.

Yes. Additionally, it's important to note that HGNS is no longer provided by just one company. With the introduction of Genio, there are now options available in the market. Today, there is an HGNS treatment solution offered by different companies. This change is significant because previous work related to HGNS has been acknowledged by the VAC committees, who are familiar with its capabilities. Currently, two companies are offering solutions, and it will be up to their physicians and patients to choose the best option together.

Okay. Great. Regarding the CCC patient population, there are no contraindications, although there is a warning that it wasn't tested. You mentioned ACCCESS, which is on the way. I might have missed the timeline for when that data will be available. How should we consider the patients on the CCC side who can be treated now versus those we can target once ACCCESS is fully in place?

We have stopped enrollment in the ACCCESS trial, which means the 12-month timeline can now begin. In 12 months, we will have data from our ACCCESS patients, and based on that data, we will submit a PMA supplement. This process typically takes about six months for the FDA to approve. Therefore, if we project that, we could potentially add CCC patients to the label by the end of Q4 2026 or the beginning of Q1 2027. Currently, the FDA has acknowledged that CCC is not a contraindication, which is a significant step toward opening the U.S. market for OSA patients affected by CCC.

Okay. So would it be fair to assume that you can start treating CCC patients since there is no contraindication? Maybe pump the gas on that once you have ACCCESS out in the PMA supplement in? Or in the near term, are you really kind of just waiting for the ACCCESS results?

So in the near term, we are waiting for the ACCCESS results, and let me be very clear on this one. We would never promote an off-label indication. And today's CCC, it's also for Genio off-label in the U.S. So we would never, ever promote this. But on the other hand, it is clear that it's not a contraindication, and it is in the warning section of our labeling. So physicians, they know what this means.

Our next question comes from the line of Michael Polark with Wolfe Research.

I have two questions. First on pricing. Can you confirm that as you launch in the U.S., you intend to price at Inspire's level of $25,000? Or has your approach to pricing changed?

No, indeed. So we use the same CPT code, and we are following also the price strategy that it comes with the CPT code, to your point.

I just thought it was worth clarifying as we go into launch. My second question is regarding the opening of accounts. Is there a request you are making of these surgeons? You invest in them and train them, and they will be targeting and competing for patients on their behalf. That’s an investment you make. What kind of return do you expect from these initial centers, if any? I’m thinking about how they are all in the hypoglossal nerve stimulation business and have significant resources. What share of their wallet are you hoping for? Perhaps not a firm commitment, but a soft commitment from these surgeons as you start with this initial group. Is it 10%, 20%, or more? I would love to understand how you navigate those initial conversations and engage this first group of implanters.

No. Thank you, Mike, for this question. And it's also a question, of course, as you can imagine, that we internally discussed as well because we have a lot of demand from physicians who are reaching out to be trained on the Genio technology, and we can unfortunately not train all of them at the same time. So what we are asking is before a physician is eligible to join a training or invited for a training, they need to come with 5 patients, clearly defined patients, and we use the criteria as the same criteria as in the DREAM study. So we ask them to come with 5 patient cases. Then they get the training. We can already discuss those 5 patients so they can be implanted right after they go back after being trained. That's what we do. When it comes to market share because you were alluding also, that we ask them 10% or 20% market share, honestly, we don't at this stage. We do think that if they are well trained, high-quality training, they do their 5 cases, meaning that they will all go through their surgical learning curve, then we are convinced that they will make the right decision when patients are coming and then also patients will know if they can choose a bilateral stimulation with a single incision. All the different differentiating factors, full body MRI compatibility that we will be able to capture a lot of patients with our Genio technology.

Ladies and gentlemen, that concludes our question-and-answer session. I will now turn the call back over to Olivier Taelman for the closing remarks.

Thank you again for your time today and your continued support of Nyxoah. As I mentioned in the beginning, this is the most exciting time already in our company history. We are so excited to be able to launch in the U.S. I would also not forget our international markets where we're also making good progress, but it's clear that the market is in the U.S. And finally, after so many months, years of hard work, I'm pleased that we can enter this, and the entire team is extremely exciting. So you will and I look forward to also updating you on our progress in the coming months. So thank you all again, and have a nice day.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.